Why Google Remains A Strong Buy For Traders

Google (GOOG) closed on the devil's number $666.10 in after-hours trading on the 19 October 2015. The stock was currently trading at $646.86 (down 2.90% or $19 lower) for the day on 20 October 2015. The stock's price/earnings ratio is 30.64 with an EPS of 21.37. The total number of shares outstanding is 685.54 million. For now however, there is a general consensus among analysts that Alphabet Inc (GOOG) is a hold as there is little to suggest that the stock will move sharply upwards or downwards at this time. Alphabet Inc (GOOG) is strong in terms of its overall financial position and its revenue growth. The stock is currently a little undervalued and this certainly bodes well for future prospects. On the downside, the ROE and the growth in EPS are a concerning.

For the year to date, Google has generated a return of 26.54%, but the three-month return is -1.02%. If we extrapolate over the course of 1 year, Google has generated returns of 30.31%. Earnings Per Share (EPS) performance is also mixed with the following figures available:

  • 3 years ago Google's EPS was 16.65
  • 2 years ago Google's EPS was 19.43
  • 1 year ago Google's EPS was 21.37
  • The company is also traded as part of Exchange Traded Funds in the following ratios:

  • Google as part of XLG at 3.070%
  • Google as part of RYT at 1.480%
  • Google as part of RSU at 1.300%
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    Consensus Opinions among Analysts this Week

    5 Day Volatility of Alphabet Inc (GOOG)

    On a rating of 1.0 to 5.0, Alphabet Inc (GOOG) features at 1.6. Recall that 1.0 is a strong buy and 5.0 is a sell. Typically a rating of 1.6 would indicate that a stock is a strong buy however the mean recommendation a week ago was 1.0, and Google has moved away from being a strong buy. Regardless, it remains a stock that investors and traders are bullish about and it is a top technology stock to have in your portfolio. In terms of price targets, the high target for Google is $840 and the low target is $700 – that indicates that at the current price of $646.86, Google is undervalued. This bodes well for traders placing call options on the stock over the short-term. This is further validated by way of the latest 3 Upgrades/Downgrades for Google from the following research firms:

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